•Promises better services, to invest $350m in two years
Ben Uzor Jr
Nigeria’s data market, characterised by slow and exasperating access to the cyberspace, will soon experience a shift for good in the area of service delivery as Mobitel Nigeria Limited, Tuesday, re-entered the nation’s telecommunications industry with a promise to further deepen Nigeria’s digital index through the provision of its latest fourth generation (4G)/WiMAX wireless broadband services.
4G refers to the fourth generation of cellular wireless standards and is a successor to 3G and 2G families of standards. With this wireless broadband service that boasts of speed 10 times faster than available 3G services, Mobitel has guaranteed to provide the nation’s telecoms consumers with widespread all-IP (Internet Protocol) based services such as high quality multimedia streaming, enhanced gaming services, super fast broadband internet access, IP telephony, among other services.
Though 4G wireless technology is not yet established to have an agreed set of standards, as it is still undergoing trials and testing globally, industry analysts say the launch of the 4G/WiMAX wireless services by Mobitel could assist the industry to potentially get ahead of many markets, thus putting Nigeria on the fore rather than playing catch-up. According to some industry experts, it could also help the company gain significant market share as competition thickens in the country’s telecoms landscape.
As at today, Nigeria’s digital index stands at about 4 percent, hence, industry stakeholders who attended the launch in Lagos all agreed that the introduction of this service would radically improve quality of service as it relates to internet service delivery. In March 2010, Mobitel acquired a 2.3GHz licence from the Nigerian Communications Commission (NCC), and with this launch, becomes one of the first providers of ‘real broadband’ in Nigeria.
Johnson Salako, chief executive officer, Mobitel, who spoke to newsmen at the unveiling event, disclosed that by investing over $70 million in the roll-out of the new service, the company was ready to deliver on its value proposition of providing ‘real broadband’ to Nigerians. Salako further revealed that the company would invest $350 million in the next two years on its national roll-out plan.
“Our mission is to deliver the best customer experience in all aspects of telecommunication service delivery as Africa’s most successful 4G network,” Salako told industry stakeholders who included Ernest Ndukwe, past executive vice chairman, NCC, Ibrahim Nakande, former minister of state for communications, Dave Salako, chairman, house committee on communications, Okechukwu Itanyi, executive commissioner, NCC, Funke Opeke, chief executive officer, MainOne Cable, among others.
Giving insight into the company’s national roll-out plans, Tomi Davis, chief operating officer, Mobitel, said: “We have already started with coverage in Lagos which we expect to be fully 4G before year-end, and the rest of Nigeria can expect to see Mobitel 4G Access delivered to them next year. By the middle of 2011, 11 more cities will get 4G coverage and by 2012, full national coverage will be achieved,” noting that the firm would focus on rural telephony.
In the same vein, Michele Scanlon, chief commercial officer, Mobitel, indicated that Mobitel will be launching cutting edge devices and service packages that push the boundary, in performance terms, to deliver an enhanced experience to customers. With speeds of up to 2,048 kbps available to customers on its network, Mobitel’s 4G Access gives customers the capability to transfer large amounts of data in seconds, listen to music and watch video from internet websites comfortably.
For more interesting articles, check out my blog, www.benedictspace.blogspot.com
Thursday, October 28, 2010
GSM operators shy away from CDMA acquisitions
•Prefer internal organic growth to M&A
Ben Uzor Jr
Indications are that the much anticipated consolidation in Nigeria’s telecommunications industry will not take place anytime soon as major GSM operators are increasingly shying away from mergers and acquisitions (M&A), and paying more attention to improving internal organic growth, analysts said. Most GSM operators, according to analysts, note that growth generated internally frequently result in better returns on investment (ROI) and lowers employee turnover as opposed to acquisition.
Industry analysts had earlier disclosed that a spate of hushed mergers and acquisitions moves was going on in Nigeria’s telecoms space, as the small operators struggle to acquire the critical mass necessary for survival, and bigger ones strive to acquire the small and move to positions of greater strength. Industry analysts who spoke to BusinessDay at the weekend strongly believe that by consolidating the CDMA landscape, GSM operators would be better positioned to offer more efficient data services whilst their core network would be used solely for the delivery voice services.
“GSM and CDMA are going to end up on a new technology called Long Term Evolution (LTE). In a couple of years, we would see a full scale commercial implementation of LTE. So, if you are going to have a convergence, we are gradually moving to technology neutrality or, if you like, interoperability of devices, networks, and so on. This is the time for a major GSM operator to begin to look at consolidating the CDMA sphere because it just adds value. Now, CDMA is the best technology for data service. GSM, as a basic technology, is very good for voice. GSM has to be upgraded to GPRS, EDGE to begin to do data.
CDMA in its basic form, CDMA 20001X, already does internet very well. Invariably, if you take the entire spectrum that we have on the CDMA area in Nigeria and dedicate it to data, then leave your GSM spectrum to voice only, I think you will see a lot of efficiency in that”, Aigbinode told BusinessDay in an interview. A senior executive of a GSM firm told BusinessDay at the weekend that CDMAs offer very little value to a GSM company. “For us, it is better to spend the money for acquisitions on improving internal organic growth. It is better to invest that money on rural network expansion and roll out new products and services because we can get better returns on our investment”, he added.
But another analyst argued that with the enormous bandwidth capacity coming from the Glo-1 and MainOne submarine cables, GSM operators may have no need for CDMAs to offer better data services. They further expound that the poor financial results of most CDMA operators have made CDMAs unattractive and reduced the prospects of M&A in the telecoms industry.
According to the analysts, the poor performances were a vivid manifestation of the protracted growth crisis in the CDMA market. In spite of the fact that CDMA operators pioneered the telecom revolution after the telecom sector was liberalised and deregulated in 2001, CDMA operators have failed to dominate the market. Over the years, their anecdote has been that of poor performances, low capital and weak competitiveness in the country’s GSM dominated telecoms landscape.
Starcomms, Multilinks-Telkom, Visafone and ZOOMmobile are the CDMA firms operating in Nigeria’s telecoms industry. Between January and July, CDMA operators in Nigeria lost about 1.08 million active subscribers. Subscriber information made available by the Nigerian Communications Commission (NCC) covering December 2009 to July 2010 shows that active mobile CDMA lines, which stood at 7.7 million in January 2010 dropped to a dismal 6.6 million lines by July.
Under the Ernest Ndukwe administration, the Nigerian Communications Commission (NCC) had admitted that some telecoms companies had begun to show disturbing signs of distress. The NCC disclosed that issues revolving around poor corporate governance, wrong business decisions, and the management style employed by these telcos in the economic crisis were some of the major factors responsible for the poor performances recorded by some of them.
Giving more insight into some of the reasons why CDMA networks have continued to perform poorly, Oladipupo Alabi, treasurer, Association of Licensed Telecommunications Operators of Nigeria (ALTON), a telecoms engineer, noted that the greatest problem facing the CDMA networks was funding. Alabi said: “The greatest problem confronting the CDMA companies in Nigeria is funding. The CDMAs are not as highly capitalised as the GSM operators. So, they do not have the same level of coverage or reach.
Also, the ease to change from one network to the other gives GSM operators an edge, whereas, the CDMAs have to buy handsets and subsidise them. This adds to their costs of operation. If a handset is faulty, GSM subscribers can easily buy another handset and swap their SIMs, but for CDMA subscribers, it is not like that. Most times, subscribers have to buy new handsets and re-programme their old numbers. That is one of the reasons why CDMA is not really growing”.
For more interesting articles, check out my blog, www.benedictspace.blogspot.com
Ben Uzor Jr
Indications are that the much anticipated consolidation in Nigeria’s telecommunications industry will not take place anytime soon as major GSM operators are increasingly shying away from mergers and acquisitions (M&A), and paying more attention to improving internal organic growth, analysts said. Most GSM operators, according to analysts, note that growth generated internally frequently result in better returns on investment (ROI) and lowers employee turnover as opposed to acquisition.
Industry analysts had earlier disclosed that a spate of hushed mergers and acquisitions moves was going on in Nigeria’s telecoms space, as the small operators struggle to acquire the critical mass necessary for survival, and bigger ones strive to acquire the small and move to positions of greater strength. Industry analysts who spoke to BusinessDay at the weekend strongly believe that by consolidating the CDMA landscape, GSM operators would be better positioned to offer more efficient data services whilst their core network would be used solely for the delivery voice services.
“GSM and CDMA are going to end up on a new technology called Long Term Evolution (LTE). In a couple of years, we would see a full scale commercial implementation of LTE. So, if you are going to have a convergence, we are gradually moving to technology neutrality or, if you like, interoperability of devices, networks, and so on. This is the time for a major GSM operator to begin to look at consolidating the CDMA sphere because it just adds value. Now, CDMA is the best technology for data service. GSM, as a basic technology, is very good for voice. GSM has to be upgraded to GPRS, EDGE to begin to do data.
CDMA in its basic form, CDMA 20001X, already does internet very well. Invariably, if you take the entire spectrum that we have on the CDMA area in Nigeria and dedicate it to data, then leave your GSM spectrum to voice only, I think you will see a lot of efficiency in that”, Aigbinode told BusinessDay in an interview. A senior executive of a GSM firm told BusinessDay at the weekend that CDMAs offer very little value to a GSM company. “For us, it is better to spend the money for acquisitions on improving internal organic growth. It is better to invest that money on rural network expansion and roll out new products and services because we can get better returns on our investment”, he added.
But another analyst argued that with the enormous bandwidth capacity coming from the Glo-1 and MainOne submarine cables, GSM operators may have no need for CDMAs to offer better data services. They further expound that the poor financial results of most CDMA operators have made CDMAs unattractive and reduced the prospects of M&A in the telecoms industry.
According to the analysts, the poor performances were a vivid manifestation of the protracted growth crisis in the CDMA market. In spite of the fact that CDMA operators pioneered the telecom revolution after the telecom sector was liberalised and deregulated in 2001, CDMA operators have failed to dominate the market. Over the years, their anecdote has been that of poor performances, low capital and weak competitiveness in the country’s GSM dominated telecoms landscape.
Starcomms, Multilinks-Telkom, Visafone and ZOOMmobile are the CDMA firms operating in Nigeria’s telecoms industry. Between January and July, CDMA operators in Nigeria lost about 1.08 million active subscribers. Subscriber information made available by the Nigerian Communications Commission (NCC) covering December 2009 to July 2010 shows that active mobile CDMA lines, which stood at 7.7 million in January 2010 dropped to a dismal 6.6 million lines by July.
Under the Ernest Ndukwe administration, the Nigerian Communications Commission (NCC) had admitted that some telecoms companies had begun to show disturbing signs of distress. The NCC disclosed that issues revolving around poor corporate governance, wrong business decisions, and the management style employed by these telcos in the economic crisis were some of the major factors responsible for the poor performances recorded by some of them.
Giving more insight into some of the reasons why CDMA networks have continued to perform poorly, Oladipupo Alabi, treasurer, Association of Licensed Telecommunications Operators of Nigeria (ALTON), a telecoms engineer, noted that the greatest problem facing the CDMA networks was funding. Alabi said: “The greatest problem confronting the CDMA companies in Nigeria is funding. The CDMAs are not as highly capitalised as the GSM operators. So, they do not have the same level of coverage or reach.
Also, the ease to change from one network to the other gives GSM operators an edge, whereas, the CDMAs have to buy handsets and subsidise them. This adds to their costs of operation. If a handset is faulty, GSM subscribers can easily buy another handset and swap their SIMs, but for CDMA subscribers, it is not like that. Most times, subscribers have to buy new handsets and re-programme their old numbers. That is one of the reasons why CDMA is not really growing”.
For more interesting articles, check out my blog, www.benedictspace.blogspot.com
Telcos move to provide affordable telecoms services in rural communities
Ben Uzor Jr
More rural communities in the country will have access to reasonably priced telecommunications services by 2012, as operators are making significant investment in rural network expansion, and taking advantage of submarine cable infrastructure to ensure that remote areas benefit from the GSM (Global System for Mobile Communications) revolution, analysts told BusinessDay.
Available statistics show that about 40 million Nigerians living in the rural areas do not have access to basic telecoms services. Industry analysts told BusinessDay that Nigeria’s digital divide is still wide even with the country’s 80 million active mobile subscribers. According to the analysts, rural dwellers desire to be connected to the rest of the world but have no telecoms facilities to do so.
Telecoms service providers do not consider such areas as economically viable and therefore give them no attention. To this effect, a significant proportion of the country’s rural populace have, before now, been ignored in the telecoms revolution which had operators focused on cities for quick returns on their investment, analysts argue. This trend is changing with the commercial launch of Glo-1 and MainOne submarine cables, according to analysts who also said this development will usher in a new era of telephone and internet access in the rural areas.
Lanre Ajayi, president, Nigerian Internet Group (NIG) told BusinessDay: “Telecoms companies are looking at rural areas because the urban areas are more or less saturated. The phase of expansion will be the unserved and underserved areas. It has not come as a surprise to me because if they have succeeded in covering the urban areas and cities, the next logical step will be to address the rural areas”.
Globacom, owners of Glo-1, disclosed plans to leverage its massive 10, 000 kilometre national optic fibre backbone to push available bandwidth capacity to the hinterlands at more affordable rates. Besides, the country’s bandwidth market is expected to witness explosive price wars as a result of heightened competition in the submarine cable market. It is further expected that the price of bandwidth will fall from $2, 400 to $10 per megabyte as the number of submarine cables increases.
Currently, MainOne cable is already bringing down existing pricing model through the reduction of communications cost by 50 percent. Prior to MainOne’s commencement of commercial service in July 2010, BusinessDay gathered that the cost of bandwidth was between $1, 200 and $1, 700 per megabyte, but it has drastically reduced to the range of $500 to $700 at the moment.
Similarly, the West African Cable System (WACS) - an initiative operated by nine countries (including Nigeria’s MTN Group), intends to adopt an aggressive entry strategy that would see prices of bandwidth fall as low as $10 per megabyte in Nigeria, informed sources told BusinessDay. Mike Adenuga Jr, chairman, Globacom, at the launch of Glo-1 submarine cable in Lagos, said: “Today, I really feel excited because we are looking at a major step change in Nigeria.
“I promise you, things are never going to be the same again because now, the Glo-1 submarine cable has arrived and we can now connect it to our 10, 000km in-land fibre optic network. This is the time we can now provide our country and its rural populace with clearer lines as well as high quality internet services to any international destination at really affordable prices”. In the same way, MTN Nigeria and Huawei Technologies have signed a $40 million (N6 billion) deal to provide rural telephony in about 850 villages across the country.
For more interesting articles, check out my blog, www.benedictspace.blogspot.com
More rural communities in the country will have access to reasonably priced telecommunications services by 2012, as operators are making significant investment in rural network expansion, and taking advantage of submarine cable infrastructure to ensure that remote areas benefit from the GSM (Global System for Mobile Communications) revolution, analysts told BusinessDay.
Available statistics show that about 40 million Nigerians living in the rural areas do not have access to basic telecoms services. Industry analysts told BusinessDay that Nigeria’s digital divide is still wide even with the country’s 80 million active mobile subscribers. According to the analysts, rural dwellers desire to be connected to the rest of the world but have no telecoms facilities to do so.
Telecoms service providers do not consider such areas as economically viable and therefore give them no attention. To this effect, a significant proportion of the country’s rural populace have, before now, been ignored in the telecoms revolution which had operators focused on cities for quick returns on their investment, analysts argue. This trend is changing with the commercial launch of Glo-1 and MainOne submarine cables, according to analysts who also said this development will usher in a new era of telephone and internet access in the rural areas.
Lanre Ajayi, president, Nigerian Internet Group (NIG) told BusinessDay: “Telecoms companies are looking at rural areas because the urban areas are more or less saturated. The phase of expansion will be the unserved and underserved areas. It has not come as a surprise to me because if they have succeeded in covering the urban areas and cities, the next logical step will be to address the rural areas”.
Globacom, owners of Glo-1, disclosed plans to leverage its massive 10, 000 kilometre national optic fibre backbone to push available bandwidth capacity to the hinterlands at more affordable rates. Besides, the country’s bandwidth market is expected to witness explosive price wars as a result of heightened competition in the submarine cable market. It is further expected that the price of bandwidth will fall from $2, 400 to $10 per megabyte as the number of submarine cables increases.
Currently, MainOne cable is already bringing down existing pricing model through the reduction of communications cost by 50 percent. Prior to MainOne’s commencement of commercial service in July 2010, BusinessDay gathered that the cost of bandwidth was between $1, 200 and $1, 700 per megabyte, but it has drastically reduced to the range of $500 to $700 at the moment.
Similarly, the West African Cable System (WACS) - an initiative operated by nine countries (including Nigeria’s MTN Group), intends to adopt an aggressive entry strategy that would see prices of bandwidth fall as low as $10 per megabyte in Nigeria, informed sources told BusinessDay. Mike Adenuga Jr, chairman, Globacom, at the launch of Glo-1 submarine cable in Lagos, said: “Today, I really feel excited because we are looking at a major step change in Nigeria.
“I promise you, things are never going to be the same again because now, the Glo-1 submarine cable has arrived and we can now connect it to our 10, 000km in-land fibre optic network. This is the time we can now provide our country and its rural populace with clearer lines as well as high quality internet services to any international destination at really affordable prices”. In the same way, MTN Nigeria and Huawei Technologies have signed a $40 million (N6 billion) deal to provide rural telephony in about 850 villages across the country.
For more interesting articles, check out my blog, www.benedictspace.blogspot.com
Nigeria’s internet market expands as Glo-1 goes commercial
Ben Uzor Jr
The commercial launch of Glo-1 Cable at the weekend has ushered in a new era of prosperity in Nigeria’s internet market, with promises of providing high speed broadband access to the doorstep of Nigeria’s rural population by leveraging on the company’s massive 10, 000km in-land metro fibre network. By delivering 2.5 terabits of bandwidth capacity, Glo-1 cable will address Nigeria’s bandwidth requirement for the next 20 years, the Second National Operators (SNO) has revealed.
In addition, Globacom disclosed that it had customised services to address the requirements of a wide segment of clients - including telecoms operators, oil and gas companies, manufacturers, education and medical institutions. Analysts say that the country’s bandwidth market is expected to witness explosive price wars occasioned by heightened competition in the submarine cable market. It is expected that the price of bandwidth will fall from $2, 400 to $10 per megabyte as the number of cables increase.
“Today, I really feel excited because we are looking at a major step change in Nigeria. I promise you, things are never going to be the same again because now our cable has arrived and we can now connect it to our 10, 000km in-land fibre optic network. “This is the time we can now provide our country and its rural populace with clearer lines as well as high quality internet services to any international destination at really affordable prices”, says Mike Adenuga Jr, chairman, Globacom, said.
As stakeholders gathered at the launch, Mohammed Jameel, group chief operating officer, Globacom noted that ‘Nigeria is a bandwidth hungry country’, further adding that by providing 2.5 terabits per second of bandwidth, the underwater cable will cater for the country’s bandwidth need for the next 20 years. The commercial launch of the cable was imperative step towards lowering cost of international communications and improving internet speeds, Jameel told the audience, which included the Senate President, David Mark, Lagos state governor, Babatunde Fashola, Edo state, Adams Oshiomole, Ogun State governor, Gbenga Daniels and the deputy governor of Osun State.
“Today is a very important day in the development of telecommunications in the country of Nigeria. Nigeria has always been a bandwidth hungry country and so is the case with many countries in Africa. Today, with the arrival of Glo-1, the people of Nigerian and corporate bodies can now enjoy efficient internet services. Nigeria is today looking for connectivity to the rest of the world. The Nigerian economy is dependent on effective communication to the rest of the world. Today is the day of teleconferencing, telemedicine, e-learning and all these initiatives cannot be achieved if the country does not have excellent bandwidth available”, the GCOO noted.
Industry stakeholders declared that the emergence of the cable will have a multiplier effect on the Nigerian economy as it would boost the adoption of new and emerging technologies such as IPTV ( Internet Protocol Television), LTE (Long Term Evolution), VoIP (Voice over Internet Protocol), among others. According to them, the commencement of commercial services would go a long way in ushering in the much anticipated broadband boom Nigerians have been yearning for.
Senate President, David Mark, also assured that the federal governments would work assiduously to provide the right environment for companies like Globacom to thrive in Nigeria. “If we provide the right opportunities and the right environments for Nigerians who would have found ourselves on the moon ever since. If a young Nigerian like Mike Adenuga has been able to achieve this amid Nigeria’s tough business environment, then you imagine what many young Nigerian can do if the environment was conducive enough. Government needs to encourage Nigerians to join the rest of the world in business, industry, education, research and development”, Mark added.
For more interesting article visit my blog, www.benedictspace.blogspot.com
The commercial launch of Glo-1 Cable at the weekend has ushered in a new era of prosperity in Nigeria’s internet market, with promises of providing high speed broadband access to the doorstep of Nigeria’s rural population by leveraging on the company’s massive 10, 000km in-land metro fibre network. By delivering 2.5 terabits of bandwidth capacity, Glo-1 cable will address Nigeria’s bandwidth requirement for the next 20 years, the Second National Operators (SNO) has revealed.
In addition, Globacom disclosed that it had customised services to address the requirements of a wide segment of clients - including telecoms operators, oil and gas companies, manufacturers, education and medical institutions. Analysts say that the country’s bandwidth market is expected to witness explosive price wars occasioned by heightened competition in the submarine cable market. It is expected that the price of bandwidth will fall from $2, 400 to $10 per megabyte as the number of cables increase.
“Today, I really feel excited because we are looking at a major step change in Nigeria. I promise you, things are never going to be the same again because now our cable has arrived and we can now connect it to our 10, 000km in-land fibre optic network. “This is the time we can now provide our country and its rural populace with clearer lines as well as high quality internet services to any international destination at really affordable prices”, says Mike Adenuga Jr, chairman, Globacom, said.
As stakeholders gathered at the launch, Mohammed Jameel, group chief operating officer, Globacom noted that ‘Nigeria is a bandwidth hungry country’, further adding that by providing 2.5 terabits per second of bandwidth, the underwater cable will cater for the country’s bandwidth need for the next 20 years. The commercial launch of the cable was imperative step towards lowering cost of international communications and improving internet speeds, Jameel told the audience, which included the Senate President, David Mark, Lagos state governor, Babatunde Fashola, Edo state, Adams Oshiomole, Ogun State governor, Gbenga Daniels and the deputy governor of Osun State.
“Today is a very important day in the development of telecommunications in the country of Nigeria. Nigeria has always been a bandwidth hungry country and so is the case with many countries in Africa. Today, with the arrival of Glo-1, the people of Nigerian and corporate bodies can now enjoy efficient internet services. Nigeria is today looking for connectivity to the rest of the world. The Nigerian economy is dependent on effective communication to the rest of the world. Today is the day of teleconferencing, telemedicine, e-learning and all these initiatives cannot be achieved if the country does not have excellent bandwidth available”, the GCOO noted.
Industry stakeholders declared that the emergence of the cable will have a multiplier effect on the Nigerian economy as it would boost the adoption of new and emerging technologies such as IPTV ( Internet Protocol Television), LTE (Long Term Evolution), VoIP (Voice over Internet Protocol), among others. According to them, the commencement of commercial services would go a long way in ushering in the much anticipated broadband boom Nigerians have been yearning for.
Senate President, David Mark, also assured that the federal governments would work assiduously to provide the right environment for companies like Globacom to thrive in Nigeria. “If we provide the right opportunities and the right environments for Nigerians who would have found ourselves on the moon ever since. If a young Nigerian like Mike Adenuga has been able to achieve this amid Nigeria’s tough business environment, then you imagine what many young Nigerian can do if the environment was conducive enough. Government needs to encourage Nigerians to join the rest of the world in business, industry, education, research and development”, Mark added.
For more interesting article visit my blog, www.benedictspace.blogspot.com
Tuesday, October 12, 2010
Telecom investments threatened by poor spectrum management
•Hinders telcos from expanding mobile broadband services
Ben Uzor Jr
Nigeria’s telecommunications industry risks losing huge foreign direct investment as a result of poor management of the national frequency spectrum resources, analysts warned at the weekend. The nation’s telecommunications industry ranks among the top 10 in attracting FDI in sub-Saharan Africa and analysts told Business Day that the sector could miss its slot as investors are already taking a second look at the industry.
National frequency spectrum refers to the entire range of electromagnetic communication frequencies available to a particular country, including those used for radio, radar and television. According to the analysts, one of the key drivers for the success recorded in Nigeria’s telecoms landscape was the country’s impressive rating as one of the top ten receivers of FDI in Africa, based on the investment made in the telecoms industry.
Investment in telecommunications sector since 2001 has exceeded $18 billion, out of which about $12 billion is from FDI while the balance is from local investors. Ernest Ndukwe, immediate past executive vice chairman (EVC), Nigerian Communications Commission (NCC) had earlier warned that for Nigeria to attract more foreign investment into the telecoms sector, there was an urgent need to efficiently manage the country’s frequency spectrum resources.
This, he further explained, would include the timely sale of available spectrum bands to support the rollout of new technologies and services. Meanwhile, telecoms operators (telcos) have complained that spectrum unavailability is hindering them from expanding mobile broadband services in Nigeria.
This is even as growth in voice service revenue is expected to stagnate, industry analysts say, thereby putting pressure on operating companies to key into data (internet) offering as a valuable new revenue stream. Wale Goodluck, corporate services executive, MTN Nigeria, who spoke to BusinessDay in a telephone interview at the weekend believes that optimal management of frequency resources will not only boost rollout of new technologies but also improve the quality of broadband services delivered by operators in the country.
“We must look at diverse alternatives to drive broadband capacity. There is a fundamental need to implement a clear spectrum policy that will lead to ubiquitous mobile broadband services. The ‘digital dividend’ must be allowed to bear fruits in Nigeria. Government must speed up the allocation of digital dividend spectrum to mobile services. They must ensure that spectrum is resold thus freeing up a lot of frequency not in use but held by people and institutions without the requisite capacity to deploy services. We must also look critically at spectrum sharing”, he noted.
The digital dividend spectrum located between 200 MHz and 1 GHz offers an excellent balance between transmission capacity and distance coverage, thus enabling efficient network deployment. Due to its good signal propagation characteristics, fewer infrastructures are required to provide wider mobile coverage, allowing communications services to be provided in rural areas at lower costs.
Lanre Ajayi, president, Nigerian Internet Group (NIG) has also emphasised the need for proper management of national frequency resources so as to sustain the remarkable growth recorded in the telecoms sphere. “Yes, I have always talked about this issue; the Federal Government has not managed our national frequency resources properly. In the early stages of Ndukwe’s tenure, management of spectrum was nicely done and it was applauded around the world. This is however not the case today.
There are three spectrums adopted globally for WiMAX deployment and they are the 2.3 GHz, 2.5 GHz and 3.5 GHz spectrum. In Nigeria, all of them are having issues. For instance, the 2.5 GHz spectrum remains ideal for WiMAX and LTE deployments but is still managed by the National Broadcast Corporation (NBC). In the case of the 3.5 GHz spectrum, NIGCOMSAT is holding strongly on to it.
I will not be surprised if investors shy away from investing in the country’s telecoms sector. Naturally, they will want to invest in other countries in Africa where they can get the needed spectrum to roll out the new services”, Ajayi told BusinessDay at the weekend.
Besides, Nigeria faces another dilemma with much of its available 2.3 GHz spectrum lying dormant at the hands of existing WiMAX operators with no imminent plans for deployment of services. Analysts say part of the responsibility of the regulator would be to guarantee that these frequencies are allocated to operators that would use them.
This, they said, was because the allotment of such frequencies to the mobile industry would assist the sector to potentially get ahead of many markets, thus putting Nigeria on the front foot rather than playing catch-up. But more importantly, it could dramatically speed up the rollout of broadband communications and increase coverage.
In 2009, the late Umaru Musa Yar’Adua’s administration cancelled the licensing of the 2.3 GHz spectrum band conducted by the NCC on the grounds that “the letters and spirit of the stipulated rules and guidelines were not adequately complied with.”
The late President thereafter directed the NCC to initiate a fresh process for the award of the 2.3 GHz spectrum band license. Consequently, the telecom regulator disclosed recently that it was urgently looking at feasible ways to provide new licenses for spectrum dependent services on 2.3 GHz, 2.5 GHz, 3.5 GHz and 5.4 GHz spectrum bands.
Ben Uzor Jr
Nigeria’s telecommunications industry risks losing huge foreign direct investment as a result of poor management of the national frequency spectrum resources, analysts warned at the weekend. The nation’s telecommunications industry ranks among the top 10 in attracting FDI in sub-Saharan Africa and analysts told Business Day that the sector could miss its slot as investors are already taking a second look at the industry.
National frequency spectrum refers to the entire range of electromagnetic communication frequencies available to a particular country, including those used for radio, radar and television. According to the analysts, one of the key drivers for the success recorded in Nigeria’s telecoms landscape was the country’s impressive rating as one of the top ten receivers of FDI in Africa, based on the investment made in the telecoms industry.
Investment in telecommunications sector since 2001 has exceeded $18 billion, out of which about $12 billion is from FDI while the balance is from local investors. Ernest Ndukwe, immediate past executive vice chairman (EVC), Nigerian Communications Commission (NCC) had earlier warned that for Nigeria to attract more foreign investment into the telecoms sector, there was an urgent need to efficiently manage the country’s frequency spectrum resources.
This, he further explained, would include the timely sale of available spectrum bands to support the rollout of new technologies and services. Meanwhile, telecoms operators (telcos) have complained that spectrum unavailability is hindering them from expanding mobile broadband services in Nigeria.
This is even as growth in voice service revenue is expected to stagnate, industry analysts say, thereby putting pressure on operating companies to key into data (internet) offering as a valuable new revenue stream. Wale Goodluck, corporate services executive, MTN Nigeria, who spoke to BusinessDay in a telephone interview at the weekend believes that optimal management of frequency resources will not only boost rollout of new technologies but also improve the quality of broadband services delivered by operators in the country.
“We must look at diverse alternatives to drive broadband capacity. There is a fundamental need to implement a clear spectrum policy that will lead to ubiquitous mobile broadband services. The ‘digital dividend’ must be allowed to bear fruits in Nigeria. Government must speed up the allocation of digital dividend spectrum to mobile services. They must ensure that spectrum is resold thus freeing up a lot of frequency not in use but held by people and institutions without the requisite capacity to deploy services. We must also look critically at spectrum sharing”, he noted.
The digital dividend spectrum located between 200 MHz and 1 GHz offers an excellent balance between transmission capacity and distance coverage, thus enabling efficient network deployment. Due to its good signal propagation characteristics, fewer infrastructures are required to provide wider mobile coverage, allowing communications services to be provided in rural areas at lower costs.
Lanre Ajayi, president, Nigerian Internet Group (NIG) has also emphasised the need for proper management of national frequency resources so as to sustain the remarkable growth recorded in the telecoms sphere. “Yes, I have always talked about this issue; the Federal Government has not managed our national frequency resources properly. In the early stages of Ndukwe’s tenure, management of spectrum was nicely done and it was applauded around the world. This is however not the case today.
There are three spectrums adopted globally for WiMAX deployment and they are the 2.3 GHz, 2.5 GHz and 3.5 GHz spectrum. In Nigeria, all of them are having issues. For instance, the 2.5 GHz spectrum remains ideal for WiMAX and LTE deployments but is still managed by the National Broadcast Corporation (NBC). In the case of the 3.5 GHz spectrum, NIGCOMSAT is holding strongly on to it.
I will not be surprised if investors shy away from investing in the country’s telecoms sector. Naturally, they will want to invest in other countries in Africa where they can get the needed spectrum to roll out the new services”, Ajayi told BusinessDay at the weekend.
Besides, Nigeria faces another dilemma with much of its available 2.3 GHz spectrum lying dormant at the hands of existing WiMAX operators with no imminent plans for deployment of services. Analysts say part of the responsibility of the regulator would be to guarantee that these frequencies are allocated to operators that would use them.
This, they said, was because the allotment of such frequencies to the mobile industry would assist the sector to potentially get ahead of many markets, thus putting Nigeria on the front foot rather than playing catch-up. But more importantly, it could dramatically speed up the rollout of broadband communications and increase coverage.
In 2009, the late Umaru Musa Yar’Adua’s administration cancelled the licensing of the 2.3 GHz spectrum band conducted by the NCC on the grounds that “the letters and spirit of the stipulated rules and guidelines were not adequately complied with.”
The late President thereafter directed the NCC to initiate a fresh process for the award of the 2.3 GHz spectrum band license. Consequently, the telecom regulator disclosed recently that it was urgently looking at feasible ways to provide new licenses for spectrum dependent services on 2.3 GHz, 2.5 GHz, 3.5 GHz and 5.4 GHz spectrum bands.
Monday, October 4, 2010
Cheap Internet coming, as undersea cable glut sparks price war
•Bandwidth may fall from $2,400 to $10 per MG
• Nigeria records 5,400% increase in Internet use
Ben Uzor Jr
More Nigerian homes will have access to cheaper internet services by 2012 as the country’s bandwidth market is expected to witness explosive price wars occasioned by heightened competition in the submarine cable market, analysts have predicted. It is expected that the price of bandwidth will fall from $ 2, 400 to $10 per megabyte as the number of submarine cables increase.
This is coming after a decade of slow, expensive and exasperating access to the information superhighway owing to the dearth of broadband infrastructure. According to them, Nigeria recorded a 5,400 percent increase in internet users from 2000 to 2009, indicating triple digit annual growth rates. Furthermore, it is indicative of the enormous potential in the growth of the internet market representing huge business prospects waiting to be harnessed, if only the necessary regulatory push and implementation of internet-based initiatives are made.
Besides, Nigeria will have five undersea cable systems connecting her to Europe and America in 2012 and they would boost data capacity to over 12 terabits per second. For years, and until the last few weeks, the only cable system serving Nigeria’s internet and data needs was the SAT-3/WASC or South Atlantic 3/West Africa Submarine Cable, which is a communication cable linking Portugal and Spain to South Africa, with connections to several West African countries along the route.
In the last few weeks, the Main One Cable System has launched, promising an astounding 4.92 terabits per second of bandwidth after upgrade. More recently, the Glo-One cable has also gone. Equally, the West African Cable System (WACS) - an initiative operated by nine countries (including Nigeria’s MTN Group), which comes with a high capacity submarine cable system linking Europe, West Africa and South Africa, will provide over 3.8 terabits per second of bandwidth.
Informed sources told BusinessDay that the WACS intends to adopt an aggressive entry strategy that would see prices of bandwidth fall as low as $10 per megabyte in Nigeria. According to the source, the reason why WACS would be able to sell at this ground-breaking rate is because the initiative is not for profit making, as most of the capacity is for members of the consortium.
Although WACS’ proposition has not yet come to fruition, Main One and Glo-One are already bringing down existing pricing model by reducing communications cost by 50 percent. Before Main One Cable commenced commercial operations, telecoms operators and Internet Service Providers (ISPs) bought 1 megabyte of bandwidth capacity for as much as $2,400, according to BusinessDay investigations. In the United States, the same megabyte per second costs $3.33 and in Japan $0.27 while in Kenya it is $600.
Moreover, Main One Cable seems not to be perturbed by growing competition in the undersea cable market. Funke Opeke , chief executive officer, Main One Cable Company had told BusinessDay recently that its open access strategy which dictates that the cable will not be in direct competition with telecommunications operators but rather provide high value wholesale bandwidth at affordable costs would definitely be the distinguishing factor as competition thickens in the cable sub-sector.
“We are open access which makes a lot of our operators’ customers feel comfortable. We provide services to all operators; we are not a retail operator, we only do business on a wholesale basis. So, we are not competing with them, its shared infrastructure. Our objective is to deliver superior value to them at a reduced cost in an open pricing scheme. You get a higher discount if you buy more volume or if you subscribe for a longer period. So, no operator is treated unfairly.”
Some industry analysts share Opeke’s opinion, arguing that WACS and ACE cables are consortium cables designed primarily to serve their members whilst Glo One cable is self-feeding for Globacom. In both cases, their idea of pricing will be very different from Main One as an independent cable. Globacom’s group chief operating officer (GCOO), Mohammed Jameel, thinks that the telecoms company’s regional reach and unique pricing model will also be a huge advantage for Glo-One cable amid competition.
“With telecoms licences in Nigeria, Ghana, Benin Republic, Cote d’Ivoire and Gambia, we are able to give circuits to customer locations and offer seamless services in several countries without engaging third parties”, Jameel explained. The GCOO further added that even where Globacom did not have operating licence, the company would be able to reach any global destination because of its strategic partnership with all major carriers.
Jameel disclosed that the primary beneficiaries of the Glo-One facility would be telecom carriers, GSM and Code Division Multiple Access (CDMA) operators and Internet Service Providers (ISPs) who will extend the benefits to remote enterprises, retailers and individuals.
Also, there are other underwater initiatives in the offering. The ACE submarine cable system covering Nigeria and other countries will stretch 17,000 kilometres (10,500 miles) from Penmarch, France, to Cape Town, South Africa, connecting 23 countries. The network will have built-in 40 gigabit per second capability and it is slated to be operational in the first-half of 2012.
Only a few days ago, BusinessDay learnt that Alcatel-Lucent was selected by eFive Telecoms, a South African telecoms firm, to build a new submarine cable network linking the west coast of Africa to South America. The system, according to sources, will be composed of two trunks - the first one connecting South Africa to Angola and Nigeria and the second trunk linking Angola to Brazil.
Meanwhile, growth in the telecommunications sector has remained on the upswing as latest statistics from the Nigerian Communications Commission (NCC) reveal that active connections peaked at over 80.6 million lines as at July this year with the GSM mobile sector accounting for the traditional market dominance with over 72.7 million lines. Furthermore, the mobile CDMA segment dropped 7.7 million lines whilst the fixed wired/wireless segment accounted for 1.1 million lines within the period.
For more interesting articles, check out my blog, www.benedictspace.blogspot.com
• Nigeria records 5,400% increase in Internet use
Ben Uzor Jr
More Nigerian homes will have access to cheaper internet services by 2012 as the country’s bandwidth market is expected to witness explosive price wars occasioned by heightened competition in the submarine cable market, analysts have predicted. It is expected that the price of bandwidth will fall from $ 2, 400 to $10 per megabyte as the number of submarine cables increase.
This is coming after a decade of slow, expensive and exasperating access to the information superhighway owing to the dearth of broadband infrastructure. According to them, Nigeria recorded a 5,400 percent increase in internet users from 2000 to 2009, indicating triple digit annual growth rates. Furthermore, it is indicative of the enormous potential in the growth of the internet market representing huge business prospects waiting to be harnessed, if only the necessary regulatory push and implementation of internet-based initiatives are made.
Besides, Nigeria will have five undersea cable systems connecting her to Europe and America in 2012 and they would boost data capacity to over 12 terabits per second. For years, and until the last few weeks, the only cable system serving Nigeria’s internet and data needs was the SAT-3/WASC or South Atlantic 3/West Africa Submarine Cable, which is a communication cable linking Portugal and Spain to South Africa, with connections to several West African countries along the route.
In the last few weeks, the Main One Cable System has launched, promising an astounding 4.92 terabits per second of bandwidth after upgrade. More recently, the Glo-One cable has also gone. Equally, the West African Cable System (WACS) - an initiative operated by nine countries (including Nigeria’s MTN Group), which comes with a high capacity submarine cable system linking Europe, West Africa and South Africa, will provide over 3.8 terabits per second of bandwidth.
Informed sources told BusinessDay that the WACS intends to adopt an aggressive entry strategy that would see prices of bandwidth fall as low as $10 per megabyte in Nigeria. According to the source, the reason why WACS would be able to sell at this ground-breaking rate is because the initiative is not for profit making, as most of the capacity is for members of the consortium.
Although WACS’ proposition has not yet come to fruition, Main One and Glo-One are already bringing down existing pricing model by reducing communications cost by 50 percent. Before Main One Cable commenced commercial operations, telecoms operators and Internet Service Providers (ISPs) bought 1 megabyte of bandwidth capacity for as much as $2,400, according to BusinessDay investigations. In the United States, the same megabyte per second costs $3.33 and in Japan $0.27 while in Kenya it is $600.
Moreover, Main One Cable seems not to be perturbed by growing competition in the undersea cable market. Funke Opeke , chief executive officer, Main One Cable Company had told BusinessDay recently that its open access strategy which dictates that the cable will not be in direct competition with telecommunications operators but rather provide high value wholesale bandwidth at affordable costs would definitely be the distinguishing factor as competition thickens in the cable sub-sector.
“We are open access which makes a lot of our operators’ customers feel comfortable. We provide services to all operators; we are not a retail operator, we only do business on a wholesale basis. So, we are not competing with them, its shared infrastructure. Our objective is to deliver superior value to them at a reduced cost in an open pricing scheme. You get a higher discount if you buy more volume or if you subscribe for a longer period. So, no operator is treated unfairly.”
Some industry analysts share Opeke’s opinion, arguing that WACS and ACE cables are consortium cables designed primarily to serve their members whilst Glo One cable is self-feeding for Globacom. In both cases, their idea of pricing will be very different from Main One as an independent cable. Globacom’s group chief operating officer (GCOO), Mohammed Jameel, thinks that the telecoms company’s regional reach and unique pricing model will also be a huge advantage for Glo-One cable amid competition.
“With telecoms licences in Nigeria, Ghana, Benin Republic, Cote d’Ivoire and Gambia, we are able to give circuits to customer locations and offer seamless services in several countries without engaging third parties”, Jameel explained. The GCOO further added that even where Globacom did not have operating licence, the company would be able to reach any global destination because of its strategic partnership with all major carriers.
Jameel disclosed that the primary beneficiaries of the Glo-One facility would be telecom carriers, GSM and Code Division Multiple Access (CDMA) operators and Internet Service Providers (ISPs) who will extend the benefits to remote enterprises, retailers and individuals.
Also, there are other underwater initiatives in the offering. The ACE submarine cable system covering Nigeria and other countries will stretch 17,000 kilometres (10,500 miles) from Penmarch, France, to Cape Town, South Africa, connecting 23 countries. The network will have built-in 40 gigabit per second capability and it is slated to be operational in the first-half of 2012.
Only a few days ago, BusinessDay learnt that Alcatel-Lucent was selected by eFive Telecoms, a South African telecoms firm, to build a new submarine cable network linking the west coast of Africa to South America. The system, according to sources, will be composed of two trunks - the first one connecting South Africa to Angola and Nigeria and the second trunk linking Angola to Brazil.
Meanwhile, growth in the telecommunications sector has remained on the upswing as latest statistics from the Nigerian Communications Commission (NCC) reveal that active connections peaked at over 80.6 million lines as at July this year with the GSM mobile sector accounting for the traditional market dominance with over 72.7 million lines. Furthermore, the mobile CDMA segment dropped 7.7 million lines whilst the fixed wired/wireless segment accounted for 1.1 million lines within the period.
For more interesting articles, check out my blog, www.benedictspace.blogspot.com
Sunday, October 3, 2010
NCC boss assures telecom subscribers of quality service
•To meet with telcos on Friday
Ben Uzor Jr
Eugene Juwah, executive vice chairman, Nigerian Communications Commission (NCC), has pledged to intensify efforts to improve the quality of service by ensuring that telecommunications operators are more responsive to the need of the consumers. Speaking at the Institute of Directors’ (IoD) members evening held at the weekend in Lagos, Juwah disclosed that the commission would meet with telecom operators on Friday, to draw up a feasible roadmap to improving service quality.
He stated that the commission had set up a taskforce to address the issues of quality of service in the telecoms sector, adding that the commission will work assiduously with operators to achieve network optimisation and speed up the rate of deployment of new base stations, switches and transmission infrastructure. “This is an important area I am particularly concerned about. I will meet with telecom operators on Friday and the issues of poor quality of service will form an integral part of my discussions with them”, the NCC boss revealed.
Giving an insight into some of the factors responsible for poor quality of service from a technological perspective, Juwah pointed out that most telecom operators may have failed to design some of their coverage areas properly, resulting in ‘blackpools’. Blackpools refers to grey areas in between base stations. This is even as they jostle to expand their network quickly in the country. “There may also be a lack of capacity in that the base stations that actually connect your calls are not properly sized and in many cases they get easily overloaded”, he added.
Since the inception of the mobile telephony in 2001, telecommunication subscribers have persistently complained about the quality of service rendered by telecom operators, which always results in billing issues, drop calls, and difficulty in recharging account, among others. But most of the frustrations, according to the telecoms operators, are as a result of cable and infrastructure cuts, particularly in Lagos and most other urban towns where road construction and maintenance are being carried out.
Alluding to the size of the population as one of the major challenges to building a quality network, Juwah pointed out that some of the actions of local and state governments and other regulatory agencies like the National Environmental Standards Regulatory Agency (NESREA) contribute significantly to poor quality of service. “If the NESREA actually locks up a base station because they feel people are complaining about radiation, then there will be poor quality of service there. One of the biggest problems we have with internet in Nigeria is that of infrastructure in terms of fibre penetration in our cities and residences. This problem normally arises in difficulty in gaining right-of-way because you cannot come and lay fibre on the road, you must have permission from the state or local government.
“NCC is planning to go into discussion over partnership with local governments, state governments, vendors, and operators in order to solve the right-of-way problem where it will be a win-win situation for everybody. Our plans will shortly be unfolded and I hope that in the near future we will start seeing the impact of this programme”, he explained.
For more interesting articles, check out my blog, www.benedictspace.blogspot.com
Ben Uzor Jr
Eugene Juwah, executive vice chairman, Nigerian Communications Commission (NCC), has pledged to intensify efforts to improve the quality of service by ensuring that telecommunications operators are more responsive to the need of the consumers. Speaking at the Institute of Directors’ (IoD) members evening held at the weekend in Lagos, Juwah disclosed that the commission would meet with telecom operators on Friday, to draw up a feasible roadmap to improving service quality.
He stated that the commission had set up a taskforce to address the issues of quality of service in the telecoms sector, adding that the commission will work assiduously with operators to achieve network optimisation and speed up the rate of deployment of new base stations, switches and transmission infrastructure. “This is an important area I am particularly concerned about. I will meet with telecom operators on Friday and the issues of poor quality of service will form an integral part of my discussions with them”, the NCC boss revealed.
Giving an insight into some of the factors responsible for poor quality of service from a technological perspective, Juwah pointed out that most telecom operators may have failed to design some of their coverage areas properly, resulting in ‘blackpools’. Blackpools refers to grey areas in between base stations. This is even as they jostle to expand their network quickly in the country. “There may also be a lack of capacity in that the base stations that actually connect your calls are not properly sized and in many cases they get easily overloaded”, he added.
Since the inception of the mobile telephony in 2001, telecommunication subscribers have persistently complained about the quality of service rendered by telecom operators, which always results in billing issues, drop calls, and difficulty in recharging account, among others. But most of the frustrations, according to the telecoms operators, are as a result of cable and infrastructure cuts, particularly in Lagos and most other urban towns where road construction and maintenance are being carried out.
Alluding to the size of the population as one of the major challenges to building a quality network, Juwah pointed out that some of the actions of local and state governments and other regulatory agencies like the National Environmental Standards Regulatory Agency (NESREA) contribute significantly to poor quality of service. “If the NESREA actually locks up a base station because they feel people are complaining about radiation, then there will be poor quality of service there. One of the biggest problems we have with internet in Nigeria is that of infrastructure in terms of fibre penetration in our cities and residences. This problem normally arises in difficulty in gaining right-of-way because you cannot come and lay fibre on the road, you must have permission from the state or local government.
“NCC is planning to go into discussion over partnership with local governments, state governments, vendors, and operators in order to solve the right-of-way problem where it will be a win-win situation for everybody. Our plans will shortly be unfolded and I hope that in the near future we will start seeing the impact of this programme”, he explained.
For more interesting articles, check out my blog, www.benedictspace.blogspot.com
Subscribe to:
Posts (Atom)